01/20/2012
Initial unemployment claims head down, slowly
The idea that regional labor markets are healing is supported by the following chart:
Because initial claims are a sign of emerging unemployment, we can say that declines are a sign of an improving unemployment situation—or, more precisely, of an employment situation that does not appear to be getting worse. That the initial claims are headed in the right direction is clear, but what is also evident is that we are still nowhere near pre-recession levels. In fact, the current level for the region is still 55 percent higher than it was in January 2006. This table shows the percent changes for individual southeastern states:
Florida's level is well above its January 2006 reading, as are the levels of Alabama and especially Georgia. Louisiana, Mississippi, and Tennessee's levels are about 20 percent over their January 2006 readings. In fact, these latter three states have seen initial claims drop at a faster rate than the nation.
As a whole, the region's levels are still above comparable U.S. figures. Nevertheless, despite the wide divergences in the region, the initial claims of all southeastern states are moving in the right direction.
By Mike Chriszt, an assistant vice president in the Atlanta Fed's research department
January 20, 2012 in Unemployment | Permalink
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04/05/2011
Employment in the Sixth District improves in February
Payroll employment in the Sixth District improved in February, following several weak months. All states in the district added jobs in February, led by Florida and Georgia, the district's two largest labor markets. Across the nation, 35 states increased payroll employment in February.
In the district's largest labor market, Florida's education and health care sector gained 11,400 jobs in February while construction added 4,400 jobs. Industries that also contributed to the monthly gain in Florida were manufacturing, information services, and other services. A recent SouthPoint post gave a more detailed look at employment in southwest Florida. Accounting for the bulk of February's job gains in Georgia were the trade, transportation, and utilities industries, which added 6,900 jobs, and construction, which added 5,000 jobs. Payroll gains in the other Sixth District states over the month were spread among several industries.
Meanwhile, household survey data from the U.S. Bureau of Labor Statistics showed that the unemployment rates in the district were little changed in February. The unemployment rate decreased in two district states—Florida and Georgia—and increased in three states—Louisiana, Mississippi, and Tennessee. Florida's unemployment rate continues to be the highest rate in the district and the third highest in the nation. All Sixth District states except Louisiana have unemployment rates above the national unemployment rate of 8.9 percent.
By Sandra Kollen, a senior economic analyst in the Atlanta Fed's research department
April 5, 2011 in Employment, Florida, Georgia, Unemployment | Permalink
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10/20/2011 at 10:08 PM
07/28/2010
Regional labor markets continue struggle
Similar to the national employment report for June, the regional employment report showed a loss in payroll employment for the month. According to the U.S. Bureau of Labor Statistics' establishment survey, the Sixth District lost 26,800 jobs in June after adding 77,400 jobs in May (see chart 1). Job losses in most District states were affected by the end of Census-related temporary jobs. For the United States as a whole, 125,000 jobs were shed in June, reflecting the end of 225,000 temporary Census jobs. Private payrolls in the District have increased over the past few months, albeit at a slow pace. In June, the District added only about 17,000 private jobs.
Looking at another labor market indicator, we also see a slight improvement in the sluggish labor market. In the U.S. Bureau of Labor Statistics household survey, June's unemployment rate decreased in all District states except for Louisiana, where it increased slightly that month. Despite the easing of the unemployment rate, all states in the District have unemployment rates above the national rate of 9.5 percent with the exception of Louisiana, which has an unemployment rate of 7 percent. Much of the decrease in the unemployment rate during the past few months is attributed to a decrease in labor force participation.
To gauge employment's short-term trend versus its long-term trend, employment momentum can be examined through the use of bubble charts (see chart 3).
The employment momentum chart simultaneously plots both short- and long-term employment trends as well as states' total employment share. The vertical (Y) axis measures short-term trends (three-month average annualized percent change). The horizontal (X) axis measures long-term trends (year-over-year percent change). The size of each state's bubble reflects its relative share of total employment among the six measured states.
The position of a state's bubble in a quadrant—the intersection of the state's short- and long-term plot—reflects its employment momentum by using four quadrants that indicate certain situations:
Quadrant 1: Both short- and long-term employment growth are positive. (The higher in the right-hand corner of the chart a state's bubble appears, the stronger the state's employment momentum.)
Quadrant 2: Short-term growth is negative, but long-term growth is positive. (Recent data point to slipping employment momentum.)
Quadrant 3: Both short- and long-term employment growth are negative. (The lower in the left-hand corner of the chart a state's bubble appears, the weaker the state's employment momentum.)
Quadrant 4: Short-term growth is positive, but long-term growth is negative. (Recent data point to improving employment momentum.)
In June, the employment momentum of the Sixth District states is positioned in the improving quadrant, so although long-term growth is still negative, short-term growth is positive. Some states were even entering the expanding quadrant in June. If we take a look back to where the Sixth District was in January (see chart 4), all District states were in the contracting quadrant with both short- and long-term employment growth negative. Although these indicators point to improvement, they show that the labor market in the Sixth District still has a ways to go before getting back to where it was prerecession, with state bubbles in the expanding quadrant and lower unemployment rates.
By Sandra Kollen, a senior economic analyst in the Atlanta Fed's research department
July 28, 2010 in Louisiana, Recession, Unemployment | Permalink
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02/24/2010
Regional labor markets: Some initial signs of improvement
In a speech last week to the Augusta Metro Chamber of Commerce, Atlanta Fed President Dennis Lockhart said that inventory replenishment and business spending are keys to unlocking the trajectory of the economic recovery. He added that:
"The third and maybe most important factor I'm watching is the labor market. I expect a very slow recovery of employment markets and, therefore, a slow decline of the unemployment rate. But it's worth noting that as the recovery got under way in the second half of last year, businesses relied on productivity enhancements to expand production and were able to defer hiring.
"A shift from productivity-driven expansion to jobs-driven expansion could materialize as benefits of earlier cost and head-count reductions reach their limit. The additional hiring that would follow would likely improve business and consumer confidence and feed a virtuous cycle."
There is little hard data showing a turnaround in the regional labor market, in part because most state-level labor market data from the Bureau of Labor Statistics are only available through December (January data will be released March 10). However, we do see evidence that job losses tapered off. For example, initial claims for unemployment insurance continue to decelerate:
In addition, the number of job losses declined steadily throughout 2009:
Anecdotal information is mixed as well. Temporary help agencies in the Southeast noted an increase in job orders in January and early February. Yet, according to our business contacts as a whole, overall job creation remained tepid. Businesses continued to describe attempts to do more with less, such as combining the duties of several jobs into one.
The Chicago Fed's Bill Testa blogged on the Midwest economy last week and noted another useful indicator that can bridge the gap between official releases from the BLS. Bill writes:
"The Conference Board tracks national and state online job vacancies on a monthly basis. Their recent release reports a third consecutive month of strong national gains in advertised vacancies. Their recent release reports a third consecutive month of strong national gains in advertised vacancies. The gains were widespread across U.S. regions, including the Midwest."
Southeastern states also saw increases in January from December in the total number of online job vacancies.
President Lockhart concluded his remarks on the outlook in Augusta by saying:
"I expect businesses to be very cautious with respect to inventory accumulation, capital spending, and hiring. But I will be watching carefully for signs that an alternative, faster-growth scenario is developing."
Through February, we see little evidence that a faster-growth scenario is building in regional labor markets. We are hopeful that the positive signs we see in temporary employment increases and in job advertisements in the region feed through into measurable job gains, but as of now we continue to expect a very slow recovery in employment.
Michael Chriszt, an assistant vice president in the Atlanta Fed's research department
February 24, 2010 in Labor Markets, Productivity, Unemployment | Permalink
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12/02/2009
Southeastern states face unemployment insurance fund shortfalls
As of mid-November, roughly 5.4 million Americans were receiving unemployment insurance, not including an additional 4.2 million collecting some form of extended benefits. Regular unemployment benefits typically run for 26 weeks, but the severity and duration of the current downturn have caused many people to exhaust their regular benefits. The table below shows unemployment insurance exhaustion rates for Southeastern states in October. In Florida, for instance, about 70 percent of claimants who received their first unemployment insurance payment six months prior, about 26 weeks back, have exhausted their regular benefits.
| Exhaustion Rates October 2009 | |
|
Alabama |
40.25% |
|
Florida |
70.16% |
|
Georgia |
57.59% |
|
Louisiana |
45.21% |
|
Mississippi |
45.39% |
|
Tennessee |
52.28% |
Elevated levels of unemployment insurance claims, the length of time that many claimants remain on benefits, and weak hiring across the Southeast have caused many states to rapidly deplete their unemployment trust funds. Currently 25 states are borrowing from the federal government, including Florida and Alabama. Alabama had $96.6 million and Florida had $691 million in outstanding loans from the Federal Unemployment Account, as of Nov. 27, 2009. Moreover, according to the U.S. Department of Labor, unemployment trust funds in Georgia, Louisiana, and Tennessee are not adequately reserved, meaning that the states do not have enough funds to pay benefits for one year at a rate equivalent to the average of the three worst 12-month periods in their history without any revenue inflow.
States across the nation need to replenish their trust funds, and as a result firms could see unemployment insurance tax hikes. Although unemployment insurance tax makes up a relatively small share of total costs to an employer, compared with wages and other benefits, a significant increase in the tax could be a burden on employers. One example is the case of Florida. Because Florida's trust fund balance dipped below a comfortable level, Florida's state unemployment insurance tax will increase from the current minimum of $8.40 per employee per calendar year to a minimum $100.30 per employee starting January 2010. (The current maximum of $378 per employee rises to $459 per employee in 2010).
By Menbere Shiferew, a senior economic research analyst in the Atlanta Fed's research department
Additional links
Employment & Training Administration Unemployment Insurance Finance Page
ETA Homepage
December 2, 2009 in Southeast, Unemployment | Permalink
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It is a good news to all. I hope the employment rate remains steady as we can no longer afford the slump of the hiring industry as it will lead to recession.